One in Four UK Properties at Risk of Flood: JBA Model Reveals

One in four UK properties are at risk of flood, according to new analysis from JBA Risk Management. The flood specialist’s new UK Flood Model, launched last week, also highlights an estimated annual cost of £527 million (US$712.7 million) to UK residential properties from flood, a figure that rises to £1.9 billion (US$2.6 billion) without flood defenses.

The analysis follows the launch of JBA Risk Management’s new UK Flood Model, which now uses the company’s FLY Technology, enabling the insurance market to build models quickly at run time rather than from traditional pre-compiled parameters. “This brings unprecedented customisation and flexibility, which combined with 5 meter resolution maps, enables re/insurers to assess flood risk to individual properties for effective risk pricing, portfolio management, and to avoid over or underinsurance,” said JBA in a statement.

The new UK Flood Model shows that flood defenses could reduce losses by an estimated 360% across river, surface water and coastal flooding, with coastal flooding up to 1300% higher without coastal flood defenses. Losses from river flood are reduced by an estimated 295% from river flood defenses. The data also shows that property level protection has the potential to make a huge difference – raising individual property defenses for all residential properties in the UK could potentially reduce losses by half.

The largest estimated annual average losses for residential properties are seen in the Hull postcode area (6% of total estimated UK losses) followed by Bristol, Glasgow, Twickenham, and Slough. Other high loss postcode districts occur in and around the Thames.

“The data, and recent flood events around the world, are a clear warning that flood remains a pervasive risk that must be taken seriously. Our new UK Flood Model’s enhanced functionality enables the insurance market to fully understand their flood exposure – users can easily, and quickly, undertake ‘what if’ investigations based on their own needs, see the impacts on their losses, and fully understand individual and portfolio risk profiles,” commented Nikki Pilgrim, technical director, JBA Risk Management.

“Flooding presents a significant risk to the UK and is changing as a consequence of climate change, developing in complex ways that could have materially varying impacts across different communities in the UK,” said Gary McInally, chief actuary, Flood Re, a joint initiative between the UK government and insurers, which aims to make flood cover more affordable.

“The changing climate means that access to up to date and detailed data will become increasingly important as organisations seek to effectively quantify and own their view of flood risk. High-quality, flexible models have a major role to play in building the understanding of that risk to inform risk management today and the building of resilience for tomorrow,” McInally added.

The UK Flood Model is underpinned by the Oasis Loss Modelling Framework, ensuring it is accessible on multiple platforms including Oasis, Nasdaq Risk Modelling for Catastrophes, and ELEMENTS from Aon’s Impact Forecasting team. The model can also be installed in-house or delivered as a bespoke portfolio analysis service by JBA’s flood experts.

Source: JBA Risk Management

Photograph: Flooded fields near Lingfield in Surrey, after southern England was hit overnight by heavy rain and strong winds from Storm Aurore moving in from France, Thursday, Oct. 21, 2021. Photo credit: Steve Parsons/PA via AP.

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